Uzbekistan Moves Toward Investment Destination Status at Tashkent International Investment Forum

Uzbekistan’s capital markets are moving from promise to execution, and the National Investment Fund of the Republic of Uzbekistan (UzNIF) has become the clearest deal to show that shift. At the 5th Tashkent International Investment Forum, global investors, bankers, development finance institutions, and export credit agencies gathered gathered around one recurring message: Uzbekistan is no longer trying to convince the world that it is open for business. The challenge now is ensuring that investment momentum becomes sustainable and led by the private sector. During a panel discussion on political risk and blended finance, government officials and international investors debated how frontier markets can attract larger volumes of private capital while reducing reliance on public financing and multilateral support mechanisms. While the discussion focused on frontier markets, Uzbekistan was at the center of nearly every exchange. Jasur Karshibaev, advisor to the Minister of Economy and Finance of Uzbekistan, opened the session by outlining the government’s long-term ambitions. According to Karshibaev, Uzbekistan aims to double the size of its economy and reach upper-middle-income status by 2030. He argued that recent economic indicators suggest the country is moving in that direction despite a difficult global environment. [caption id="attachment_50612" align="aligncenter" width="1024"] Image: TCA[/caption] “The reforms under the leadership of the President of Uzbekistan are already bearing results,” he said, pointing to strong first-quarter economic growth and declining inflation. Karshibaev highlighted recent developments in the country’s sovereign credit profile. In June, Fitch Ratings affirmed Uzbekistan’s sovereign rating at BB and revised the outlook to positive. Yet despite this progress, he stressed that the government’s focus is shifting from public investment toward private capital mobilization. “We cannot base our success on fiscal intervention,” Karshibaev said. “It should be private-sector-led growth.” For Uzbekistan, attracting private investment is becoming more important as the economy expands faster than domestic savings can support. The country continues to seek foreign capital, but officials are increasingly focused on reducing the cost of accessing it. Karshibaev argued that one of the main challenges lies in the gap between perceptions of risk and economic realities. He noted that sovereign bond spreads have narrowed significantly and are approaching levels typically associated with investment-grade economies. However, some institutional risk assessments and country-risk classifications continue to reflect older perceptions. “International investors who vote with their cash are expecting a very positive credit trajectory,” he said. According to Karshibaev, risk assessments need to reflect economic fundamentals more accurately because inflated risk perceptions can raise financing costs and make blended finance instruments less competitive than commercial funding alternatives. He said the government is working closely with international financial institutions, including the Asian Development Bank and the World Bank, while pursuing reforms aimed at achieving investment-grade status before the end of the decade. [caption id="attachment_50614" align="aligncenter" width="1774"] Image: TCA[/caption] Investors also examined how frontier markets are evaluated in practice. Francis Malige, managing director and head of the Financial Institutions Business Group at the European Bank for Reconstruction and Development, argued that one of the biggest misconceptions about frontier markets stems...